U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 20355 / November 2, 2007
Securities and Exchange Commission v. Harry H. Yim, Case No. 07 CV 2065 IEG (AJBx) (S.D. Cal.)]
SEC Sues Former Invitrogen Scientist for Insider Trading
The Securities and Exchange Commission filed insider trading charges today against a former scientist of Invitrogen Corporation. The Commission's complaint alleges that Harry H. Yim, age 45, of Vista, California traded in Invitrogen stock immediately upon learning of non-public information about the company's poor financial results. The complaint further alleges that, as a result of his improper stock sales, Yim avoided losses of approximately $79,581 that he otherwise would have incurred from the decline in the company's stock price.
The Commission's complaint, filed in federal district court in San Diego, California, alleges that Yim attended a company-wide, employee-only meeting on July 7, 2004. At the meeting, Invitrogen's chief executive officer disclosed material non-public information regarding the company's negative financial performance. Immediately after the meeting, according to the Commission's complaint, Yim attempted to sell his Invitrogen stock and continued his efforts until, on July 19, 2004, he sold all the shares of Invitrogen stock he could.
On July 21, 2004, Invitrogen announced its second quarter earnings and lowered its revenue projections for the remainder of Invitrogen's fiscal year. After Invitrogen's July 21, 2004 earnings release, Invitrogen's stock price fell by more than 20% and its trading volume rose to over 14 million shares -- a 1,546% increase from the previous day's volume. The Commission's complaint alleges that Yim avoided losses of approximately $79,581 by selling his Invitrogen shares prior to the July 21 earnings release.
The Commission's complaint alleges that Yim violated Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The Commission seeks an order permanently enjoining Yim against future violations of the federal securities laws, requiring Yim to pay disgorgement in the amount of the losses avoided plus prejudgment interest on that amount, and imposing a civil penalty.